Merits and Demerits of Ethnocentric Approach
Merits
Companies do not worried about to make a new
strategy because they sim ply followed cut and paste strategy.
·
It is helpful to those industries which are new
and first time export their product in other country.
·
Companies do not have high risk because if
foreign market reject that product than they can sale the product in domestic
market so they can manage their risk.
·
They do not need different technology because
they can use same technology in foreign market.
·
In case of food and Garment product they can try
to influence foreign customer towards their culture and taste. Sometimes it is
much benefit and customers like new taste and new style of Garment product.
·
Companies can export with the lesser amount of
capital.
·
If any problems arise during the export they can
easily control it. It cannot be change.
·
They do not want high amount for investment.
Demerit
·
This approach is not fulfill the condition of “Think
Global Act Local”.
·
There are lesser chances to expand their
business in foreign market. It is not good for a longer time period.
·
There are various problems at the time of export
with the lesser amount of capital.
·
Companies get lower return.
·
This approach is not very much success in that
country where rules and restrictions are very strict because every country has
different norms and conditions.
1:57 AM
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